PURPOSE: to put back by one year the time limit for transposition and application of rules on markets in financial instruments (MIFID II package).
LEGISLATIVE ACT: Directive (EU) 2016/1034 of the European Parliament and of the Council amending Directive 2014/65/EU on markets in financial instruments.
CONTENT: this Directive amends Directive 2014/65/EU (MIFID II) in order to put back the date of entry into application of the MIFID II, following difficulties encountered by the European Securities and Markets Authority (ESMA) and national competent authorities, and stakeholders in technical implementation.
The MIFID II directive, like Regulation (EU) No 600/2014 (MiFIR) should be applied 30 months after entry into force, i.e. 3 January 2017. The date of transposition of MIFID II is 3 July 2016. However, following difficulties in technical implementation encountered by ESMA and national competent authorities, new data collection infrastructure will not be in place by 3 January 2017.
The implementation process for the data collection infrastructures involves five steps: business requirements, specifications, development, testing and deployment. ESMA estimates that those steps will be completed by January 2018.
Deferral of dates: in order to ensure legal certainty and avoid potential market disruption, the Directive defers the date by which the Member States need to transpose Directive 2014/65/EU to 3 July 2017. The new date for application of the Directive is 3 January 2018. The dates for reports and review are set back accordingly.
Exemptions: the exemption set out in point (d) of Article 2(1) of Directive 2014/65/EU is extended to include non-financial entities who are members of or participants in a regulated market or a multilateral trading facility (MTF), or have direct electronic access to a trading venue when executing transactions on a trading venue which are objectively measurable as reducing risks directly relating to the commercial activity or treasury financing activity of those non-financial entities or their groups.
Third-country markets: the Directive provides that a third-country market shall be considered to be equivalent to a regulated market if the certain requirements laid down in the Directive are fulfilled. At the request of the competent authority of a Member State, the Commission shall adopt equivalence decisions in accordance with the examination procedure (comitology).
The Directive sets out the conditions that the third-country legal and supervisory framework must fulfil in order to be considered equivalent.
ENTRY INTO FORCE: 1.7.2016.